February 12, 2019
The Dutch economy has performed very well in recent years. Growth is estimated at 2.6 percent in the 2018, owing to strong domestic demand and robust net exports.
", "publishDate": "2019-02-12", "sections": [ { "heading": "Overview", "content": "- Date: February 12, 2019.\n- Growth estimated at 2.6 percent in 2018, driven by strong domestic demand and robust net exports.\n- Current account surplus estimated at 9.8 percent of GDP in 2018.\n- Unemployment reached a decade low; real wages and inflation remain subdued.\n- Households and corporations are deleveraging; credit growth remains negative.\n- Banks’ capitalization improved; non-performing loans among the lowest in the euro area." }, { "heading": "Economic performance and outlook", "content": "- Near-term: Strong domestic demand will support growth as global trade slows.\n- Medium- and long-term: Unfavorable demographic developments and weak productivity growth will weigh on potential growth.\n- Inflation and wages: Projected to pick up gradually owing to continued labor market tightening and increased basic VAT.\n- Fiscal policy: Will remain supportive; public debt is projected to decline further." }, { "heading": "Risks to the outlook", "content": "- Downside-tilted risks include:\n - Rising global protectionism and threats to global demand.\n - Uncertainties surrounding fiscal policies in other euro area countries.\n - A possible no-agreement Brexit.\n - Sharp tightening of global financial conditions, which could:\n - Weigh on highly leveraged households with large balance sheets.\n - Increase volatility of the economy and reduce consumption.\n - Heighten stress in banks due to heavy reliance on wholesale funding." }, { "heading": "Executive Board Assessment and recommendations", "content": "- Directors’ summary:\n - Commended sound macroeconomic management and robust economic performance increasingly driven by domestic demand.\n - Noted growth rates above the euro area average, a strong fiscal position, low unemployment, and a generally healthy banking sector.\n - Highlighted structural imbalances in household and corporate sectors and external uncertainties that weigh on medium-term potential growth.\n- Priority policy areas recommended by Directors:\n - Address imbalances by boosting household disposable income and reducing household debt.\n - Strengthen the small and medium‑sized enterprises (SMEs) sector to support long‑term growth and resilience.\n - Use the economic upswing to build fiscal buffers; many Directors recommended:\n - Further reducing labor taxation.\n - Increasing spending on priorities such as human capital and research and development (R&D).\n - Preserving some fiscal space as a buffer against adverse shocks.\n - Encourage higher wage growth and welcome planned decrease in the labor tax wedge.\n - Reduce labor market duality; part‑time workers and the self‑employed have on average lower wages.\n - Pension system reform that provides more choice could reduce prevalence of self‑employment and support higher wages.\n - Improve housing affordability and reduce household indebtedness:\n - Lower mortgage interest deductibility to reduce mortgage debt bias.\n - Further tighten macroprudential policies, including loan‑to value and debt‑service‑to‑income ratios.\n - Further liberalize rent controls, improve mean‑testing for social housing, and simplify building permit procedures to boost housing supply.\n - Improve coordination among main stakeholders.\n - Support SMEs and boost investment:\n - Expand direct public support to R&D.\n - Increase access to finance for SMEs; consider establishing a credit bureau to improve information availability and access to finance.\n - Financial sector:\n - Continue building buffers and strengthen supervision given banks remain highly leveraged, concentrated, and vulnerable to shocks.\n - Maintain a strong AML/CFT framework given the Netherlands’ position as a financial and corporate center." }, { "heading": "Key economic indicators (2017–2020)", "content": "- National accounts (percent change)\n - Gross domestic product: 2017 = 2.9; 2018 = 2.6; 2019 = 2.2; 2020 = 2.1\n - Private consumption: 2017 = 1.9; 2018 = 2.4\n - Public consumption: 2017 = 1.1; 2018 = 1.4; 2019 = 1.8; 2020 = 2.0\n - Gross fixed investment: 2017 = 6.1; 2018 = 4.9; 2019 = 4.7; 2020 = 4.5\n - Total domestic demand: 2017 = 2.7; 2018 = 2.8\n - Exports of goods and nonfactor services: 2017 = 5.4; 2018 = 5.1; 2019 = 4.4; 2020 = 3.9\n - Imports of goods and nonfactor services: 2017 = 5.5; 2018 = 5.3\n - Net foreign balance¹: 2017 = 0.9; 2018 = 0.2; 2019 = -0.3; 2020 = -0.4\n - Output gap (percent of potential output): 2017 = -0.1; 2018 = 0.7; 2019 = 1.2\n- Prices, wages, and employment\n - Consumer price index (HICP): 2017 = 1.3; 2018 = 1.6\n - GDP deflator: 2017 = 2.3\n - Hourly compensation (manufacturing): 2017 = 2.5; 2018 = 3.0\n - Unit labor costs (manufacturing): 2017 = -1.5; 2018 = 0.0; 2019 = 0.1; 2020 = 0.4\n - Employment (percent) — Unemployment rate (national definition): 2017 = 5.9\n - Unemployment rate (ILO definition): 2017 = 3.8; 2018 = 3.7\n - NAIRU: 2017 = 5.2\n- External trade\n - Merchandise balance (percent of GDP): 2017 = 9.6; 2018 = 9.1; 2019 = 8.6; 2020 = 8.0\n - Current account balance (percent of GDP): 2017 = 10.5; 2018 = 9.8; 2019 = 9.5; 2020 = 8.9\n- General government accounts (percent of GDP)\n - Revenue: 2017 = 43.7; 2018 = 43.6; 2019 = 44.0\n - Expenditure: 2017 = 42.6; 2018 = 42.5; 2019 = 43.0; 2020 = 42.8\n - Net lending/borrowing: 2017 = 1.0; 2018 = 0.8\n - Primary balance: (not specified numerically in table)\n - Structural balance²: 2017 = 0.5\n - Structural primary balance²: 2017 = 1.5\n - General government gross debt: 2017 = 57.0; 2018 = 54.6; 2019 = 51.6; 2020 = 49.1\n\nIMF Executive Board Concludes 2019 Article IV Consultation with Kingdom of the Netherlands, February 12, 2019.\n\n---\n\n\n References\n\n- https://www.imf.org/-/media/images/imf/bios/imfboard.jpg\n- The Executive Board\n- Kingdom of the Netherlands-The Netherlands and the IMF\n- IMF Policy Advice -- A Factsheet\n- Press Releases\n- PRESS CENTER\n- http://www.imf.org/external/np/sec/misc/qualifiers.htm\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2019/02/12/pr1936-kingdom-of-the-netherlands-imf-executive-board-concludes-2019-article-iv-consultation" } ], "bullets": [ "[Markdown version](/en/news/articles/2019/02/12/pr1936-kingdom-of-the-netherlands-imf-executive-board-concludes-2019-article-iv-consultation/index.md)", "[Structured JSON version](/en/news/articles/2019/02/12/pr1936-kingdom-of-the-netherlands-imf-executive-board-concludes-2019-article-iv-consultation/index.json)", "[Bundle manifest](/en/news/articles/2019/02/12/pr1936-kingdom-of-the-netherlands-imf-executive-board-concludes-2019-article-iv-consultation/bundle-manifest.json)", "Published: February 12, 2019", "Date: February 12, 2019.", "Growth estimated at 2.6 percent in 2018, driven by strong domestic demand and robust net exports.", "Current account surplus estimated at 9.8 percent of GDP in 2018.", "Unemployment reached a decade low; real wages and inflation remain subdued.", "Households and corporations are deleveraging; credit growth remains negative.", "Banks’ capitalization improved; non-performing loans among the lowest in the euro area.", "Near-term: Strong domestic demand will support growth as global trade slows.", "Medium- and long-term: Unfavorable demographic developments and weak productivity growth will weigh on potential growth.", "Inflation and wages: Projected to pick up gradually owing to continued labor market tightening and increased basic VAT.", "Fiscal policy: Will remain supportive; public debt is projected to decline further.", "Downside-tilted risks include:", "Directors’ summary:", "Priority policy areas recommended by Directors:", "National accounts (percent change)", "Prices, wages, and employment", "External trade", "General government accounts (percent of GDP)", "[https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg)", "[The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx)", "[Kingdom of the Netherlands-The Netherlands and the IMF](http://www.imf.org/external/country/NLD/index.htm)", "[IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)", "[Press Releases](https://www.imf.org/en/news/searchnews)", "[PRESS CENTER](http://presscenter.imf.org/)", "[http://www.imf.org/external/np/sec/misc/qualifiers.htm](http://www.imf.org/external/np/sec/misc/qualifiers.htm)", "[https://www.imf.org/en/home](https://www.imf.org/en/home)" ], "alternates": { "markdown": "/en/news/articles/2019/02/12/pr1936-kingdom-of-the-netherlands-imf-executive-board-concludes-2019-article-iv-consultation/index.md", "json": "/en/news/articles/2019/02/12/pr1936-kingdom-of-the-netherlands-imf-executive-board-concludes-2019-article-iv-consultation/index.json", "bundleManifest": "/en/news/articles/2019/02/12/pr1936-kingdom-of-the-netherlands-imf-executive-board-concludes-2019-article-iv-consultation/bundle-manifest.json" }, "generatedAtUtc": "2026-09-25T22:31:16.756Z" }